Once upon a time in America, when families went out for dinner they often went to neighborhood Chinese restaurants to eat what passed for Chinese food -- things like egg rolls and chow mein and chop suey and thin slices of roast pork edged in pink. The extensive range of today's Chinese menus wasn't even imagined.

Into that mix, the Yenching Palace was born in the mid-'50s. A spacious vaguely exotic place in Cleveland Park that expanded the culinary offerings way beyond Cantonese, the restaurant attracted a glamorous following that included foreign diplomats, senators and congressmen, government hot-shots, top-ranking journalists and people from all over who just wanted to see what the buzz was all about.

For decades, the clientele at Yenching filled guest books any Washington-area restaurant would envy. Names like Henry Kissinger. Daniel Ellsberg. Arthur Goldberg. George Balanchine. American ambassador David Bruce. Dionne Warwick. Wayne Morse. Art Garfunkel. James Baldwin. Mick Jagger. Eugene McCarthy. Andrew Young. Walter Mondale. Jody Powell. The Washington Bullets. James Watt.

Foreign diplomats and political figures were regular customers as well. In fact, recalls Yenching manager K.C. Chow, who started as a busboy, and then became a waiter and manager at the restaurant back then, its motto used to be "We serve more diplomats than the White House."

The place was so central to the culture of the day that, if legend (and the Yenching menu) is to be believed, during the 1962 Cuban Missile Crisis, the restaurant was used as a meeting place between emissaries of Soviet Premier Nikita Khrushchev and President John F. Kennedy to discuss terms that eventually ended the crisis and avoided a war. Yenching became even more of a Washington landmark after Nixon's trip to China in 1972, when China, which hadn't had a U.S. presence since the Communists came to power in 1949, sent a diplomatic mission to Washington. Yenching's co-owner, Van Lung, was well positioned to receive them. His father, Lung Yun, a one-time warlord and governor of Yunnan province in southwest China, had eventually become a stalwart of the Communists in Peking. In time, restaurateur Lung became an active but unofficial pro-Peking figure in Washington. And the new Chinese delegation held banquets at his restaurant.

So it was only natural that, when the newcomers to Washington were bewildered by American food, the solution was Yenching. At first the restaurant sent lunch and dinner every day to the Mayflower Hotel, where the delegation was located. Soon a chef and a wok were dispatched. The arrangement ended only after the Chinese remodeled a hotel on Connecticut Avenue to use as a chancery and residence. But even then they relied on Yenching, which sent young K.C. Chow to train the waiters in American ways.

Now, decades later, much has changed for Yenching, but it doesn't lack for business. Chinese restaurants all across the country now serve the Mandarin and Sichuan dishes Yenching was known for. And waves of Asian immigrants have brought competing cuisines -- Japanese, Thai, Indian, Vietnamese -- to far-flung cities and suburban malls. The booming American economy has affected dining-out habits as well -- not always to the advantage of older restaurants such as Yenching. As more Americans made more money, they liked to eat out more often, which in turn resulted in more restaurants and more sophisticated diners.

Yenching, once virtually alone in Cleveland Park, now faces a host of hot competitors. "It's like restaurant row," says K.C. Chow, who after years in the restaurant business in New York and Kansas City, is once again the manager at Yenching (now owned by Van Lung's nephew Larry Lung), and the man who has brought it in line with today. "Over the years tastes change, and we've had to move with the times."

Yenching not only has to please the older clientele who expect the old menu, but also has to attract the newer, younger crowd. To that Chow has added vegetarian options, and dishes without salt or MSG, as well as very un-Chinese dishes that today's restaurant- goers eat tons of, like pad thai and teriyaki salmon and lemon grass chicken and salads with grilled shrimp or chicken. "The younger people are the big spenders," says Chow. "And they know exactly what they want to put in their bodies."

One of the things today's diners don't want to put in their bodies much is whiskey. "I've got a cellar full of unopened bottles of Old Forester and Old Grand Dad and old everything," he says. But wine is another story, so Chow has updated the wine list, and added a wide selection of domestic and imported beers. Another drawing card he has played is a very affordable list of lunch specials (from $3.95 for deep-fried tofu served in broth with ginger, seaweed and scallions to $10.95 for teriyaki steak or grilled garlic shrimp with noodles in a red curry sauce). Dinner entrees (from all over China) range from $8.95 to $12.95.

The once staid restaurant even rents out its banquet room for charity fundraisers and parties, and has installed a platform for live music. "Sometimes they come earlier to eat," says Chow. "It's just another way of bringing a younger generation to an old place."

Yenching Palace; 3524 Connecticut Ave. NW; call 202-362-8200. Monday-Thursday, 11:30 a.m.-11 p.m.; Friday and Saturday, 11:30 a.m.-11:30 p.m.; Sunday, noon-11 p.m.

Yenching Palace manager K.C. Chow, left, with owner Larry Lung.